Sentencing update -Two Los Angeles business owners arrested in alleged million dollar mobile phone insurance scam
News: 2016 Press Release
On July 7, 2016, Jason Kwon and David Chang were convicted of insurance fraud, grand theft, and identity theft. Kwon was sentenced to six years of suspended prison term, five years probation, and one year in jail. Chang was sentenced to six years of suspended prison term, five years probation and 90 days in jail. Total restitution was determined to be $517,502, of which $360,000 was paid to the victim insurance company prior to sentencing.
LOS ANGELES, Calif. — Jason Kwon, 32, of Santa Fe Springs and David Chang, 32, of Burbank face 41 felony counts of insurance fraud, grand theft and identity theft for allegedly submitting fraudulent claims totaling $1.3 million to obtain low cost replacement mobile phones that they then sold for profit.
An investigation by the Department of Insurance revealed that Kwon, owner of Talk Talk Wireless, and Chang, owner of Hello Mobile, conspired to submit more than 1000 false claims for allegedly lost or stolen mobile phones.
Both suspects used personal information from mobile phone accounts of unsuspecting customers and forged forms needed to file claims. Chang and Kwon provided the insurer with addresses they had access to and requested the replacement mobile phones be shipped to those locations. The two suspects then sold the mobile phones at a profit.
“These crimes are an expensive drain on the state's economy totaling billions annually,” said Insurance Commissioner Dave Jones." The cost of fraud is passed along by insurers and business to consumers through higher rates and more costly goods and services."
Chang was arrested May 14, 2015 by Los Angeles Airport Police. Kwon surrendered in court May 19, 2015. Both suspects are held on $1.57 million bail each and are due back in court on May 28, 2015. This case is being prosecuted by Los Angeles District Attorney High Tech Crimes Unit.
- David Chang booking photo
- Jason Kwon no booking photo available
- Talk Talk Wireless is located in Fullerton, CA
- Hello Mobile is located in Los Angeles, CA
The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $310 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $469 million in claims and premiums. Please visit the Department of Insurance website at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.4357. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.